cosco capital groupcoscocapitalbeta.webtogo.com.ph/images/items/uploads/3q... · 2016. 1. 21. ·...

COSCO CAPITAL GROUP

INVESTOR PRESENTATION 9M 2015 RESULTS & PERFORMANCE

1

DISCLAIMER

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COSCO CAPITAL, INC. (COSCO). COSCO is solely responsible for the accuracy

and completeness of the contents of such presentations and/or other documents.

Third parties, other than COSCO, do not have any responsibility for or control over

the contents of such presentations and/or other documents. No endorsement is

intended or implied notwithstanding the distribution of this presentation and/or other

documents during the analysts and investors calls and meetings of COSCO. The

materials and information in the presentations and other documents are for

informational purposes only, and are not an offer or solicitation for the purchase or

sale of any securities or financial instruments or to provide any investment service

or investment advice.

2

CONGLOMERATE MAP

3

Lucio Co & Family

Cosco Capital Inc.

Grocery Retailing

Liquor Distribution

Commercial Real Estate

Specialty Retail

Oil & Minerals

73%

51% 100% 100%

100%

100%

90%

One of the leading retail holding companies in the Philippines

CORPORATE RESTRUCTURING

4

CORPORATE HIGHLIGHTS

April 22: Approval by the

Securities and

Exchange Commission

(SEC) of change in

corporate name and

increase in capital stock

of Parent company.

May 31: Implementation

of issuance and listing

of new shares, cross

trade at the Philippine

Stock Exchange (PSE)

of PGOLD shares to

the Parent company,

issuance of shares to

the subscribers

pursuant to share swap,

special block sale at the

PSE of new shares.

August 12: Cosco Capital, Inc. through

its wholly-owned subsidiary, Ellimac

Prime Holdings, Inc., acquired

Maunlad mall situated at Malolos

Bulacan

August 6: Puregold Price Club, through

wholly-owned subsidiary Entenso

Equities and Goldtempo Company, Inc.,

acquired eight (8) supermarket stores

operating under trade name Budgetlane

August 5: through wholly-owned

subsidiary, Ellimac Prime Holdings,

Inc. acquired RFC mall located along

Alabang, Zapote, Las Pinas City

February 3

Puregold Price Club, Inc. acquired

nine (9) supermarkets from NE

Incorporated.

Cosco Capital, Inc. through its

wholly-owned subsidiary, Ellimac

Prime Holdings, Inc., acquired four (4)

commercial properties from NE

Incorporated

January 29: Approval of

merger of Nation Realty,

Inc., Go Fay & Co, Inc.,

SVF Corporation and 999

Shopping Mall, Inc. (Nation

Realty, Inc. as the

absorbing entity).

February 28: Acquisition of

NE Pacific Shopping

Centers Corporation

May 1: Acquisition of Office

Warehouse, Inc.

July 17: Acquisition and

subscription of additional

shares of Canaria Holdings

Corporation.

July 21: Acquisition of

Liquigaz Philippine

Corporation through

Canaria Holdings

Corporation

2013 2014 2015

5

INVESTMENT SUMMARY

1. Sustained economic growth of the Philippines

2. Exposure to growing & robust consumer sector

3. Visible growth pipeline in the next 5 years

4. Focused core target market per brand

5. Management focused on the sustainable and Long-Term growth ofthe company

6

9M 2015 RESULTS AND PERFORMANCE

Consolidated revenue grew by 23% in 9M 2015;Grocery Retail segment accounted for about 83% of theconsolidated revenue.

Gross profit grew by 15% in 9M 2015; with gross marginposted 17%.

Consolidated net income grew by 15% in 9M 2015; withconsolidated net profit margin at 6%.

7

9M 2015 REVENUE AND PATMI CONTRIBUTIONS

8

54%

24%

13%

14%

-6%

PATMI

Grocery retailing

Real estate

Liquor distribution

Specialty retail

Parent, mining and oil

83%

1%

4%

12% 0%

REVENUE

Grocery retail

Real estate and propertyleasing

Liquor Distributions

Specialty retail

Oil and Gas

REVENUE CONTRIBUTION BY BUSINESS SEGMENT

86%

4%

1% 9%0%

FY 2014

GROCERY RETAIL

LIQUOR DISTRIBUTION

REAL ESTATE

SPECIALTY RETAIL

PARENT, OIL & MINING

94%

4%

2%

0%

0%FY 2013

GROCERY RETAIL

LIQUOR DISTRIBUTION

REAL ESTATE

SPECIALTY RETAIL


9

PATMI CONTRIBUTION BY BUSINESS SEGMENT

10

57%15%

24%

3% 1%FY 2014

GROCERY RETAIL

LIQUOR DISTRIBUTION

REAL ESTATE

SPECIALTY RETAIL


52%24%

23%0% 1%

FY 2013

GROCERY RETAIL

LIQUOR DISTRIBUTION

REAL ESTATE

SPECIALTY RETAIL


PATMI – Net income attributable to equity holders of the parent company

9M 2015 CONSOLIDATED FINANCIAL PERFORMANCE

11

48,976

98,787

66,28481,455

2013 2014 9M 14 9M 15

Revenues (in Php Millions) Gross Profit and Margin (in Php Millions)

9,534

17,012

11,74213,490

19% 17% 18%

17%

8%

13%

18%

23%

28%

33%

38%

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

2013 2014 9M 14 9M 15GP GP Margin

5,733

10,179

6,7177,742

12%10% 10% 10%

0%

5%

10%

15%

20%

25%

30%

2,000

4,000

6,000

8,000

10,000

12,000

2013 2014 9M 14 9M 15EBITDA EBITDA Margin

EBITDA and Margin (in Php Millions) Net Profit and Margin (in Php Millions)

3,731

6,236

4,0334,622

8% 6% 6% 6%

0%

5%

10%

15%

20%

25%

1,000

2,000

3,000

4,000

5,000

6,000

7,000

2013 2014 9M 14 9M 15

NIAT NIAT Margin

1 3 16 20 30 4164

102

158

215248

1998 2001 2006 2007 2008 2009 2010 2011 2012 2013 2014

Stores roll-out through FY 2014

First store

Opened in

Mandaluyong

City, Metro

Manila

Expansion

Launched loyalty

program in 2001;

renamed as

Tindahan ni Aling

Puring in 2004

Between 2002 and

2006, launched an

average of 3 new

stores every year

and expanded

operations in North

and South Luzon

Brand recognition

Reader’s Digest

Asia’s “Most

Trusted Brands”

Market leadership

The 2nd largest

hypermarket and

supermarket

retailer in the

Philippines in

terms of net sales

Rapid expansion via organic

new Puregold stores roll-out

and acquisitions

2011 - Opened 38 new

Puregold stores

2012 – Opened 31 new

Puregold stores; Acquired

Parco supermarkets with 19

stores and S&R warehouse

membership shopping club

with 6 stores

Rapid store expansion from 1 to 248 stores in 16 years

First format

introduction

New format

introduction

New format

introduction - 2010

Continuing new

stores roll-out via

organic

geographic

expansion and

acquisitions

Opened 40 new

Puregold and 2

new S&R stores in

2013

Acquired Company

E with 15 stores in

same year

12

RETAIL SEGMENT HIGHLIGHTS

13

Opened 16 new PGOLD stores; 7 S&R New York Style Pizza (QSR) in 9M 2015; acquired 9 Stores NE Bodega, 8 Stores Budgetlane Supermarket and closed 4 PGOLD stores

Operating 267 stores as of 9M 2015; with consolidated NSA of more than 421,000 sqm.; excluding acquisition NE Bodega of around 15,000 sqm and Budgetlane of around 18,000 sqm.

Consolidated net sales expanded by 12.6% in 9M 2015; Puregold stores sales accounted for about 82.7% of consolidated net sales

Gross profit grew by 6.8% in 9M 2015; with gross profit margin posted 16.3%

Operating income increased by 6.6% in 9M 2015; with operating margin at 6.8%

Consolidated Net income grew by 6.5% in 9M 2015; consolidated net profit margin at 4.8% PGOLD only net margin is at 3.6% while S&R net margin is 10.1%.


Guidance for FY 2015

14

• Consolidated net sales targeted to grow by 12 to 15% driven by the following:

– Net sales growth from Puregold and S&R stores

– Positive SSSG for Puregold (2-3%) and S&R (2-3%)

– Opening of 25 new Puregold stores; 1 S&R & 5 S&R QSR

– Acquisition of NE Bodega & Budgetlane Supermarket

– Opening of new store formats: Lawson Convenience Stores and Merkado Supermarket (AYAGOLD)

• Sustain current PGOLD consolidated gross and net profit margins

• Pursue acquisitions and expand into new geographic locations


15

• CAPEX Budget of Php 3.4 billion in 2015

– Php 1 billion for 25 new Puregold Stores

– Php 550 million for 1 S&R

– Php 150 million for 10 S&R QSR

– Php 40 million for S&R store renovations

– Php 150 million for 25 Lawsons Stores

– Php 1.5 billion for acquisitions

• To be funded by internally generated cash and short term untapped bank credit lines if necessary.

RETAIL SEGMENT FINANCIAL PERFORMANCE

Revenues (in Php Millions)

EBITDA and Margin (in Php Millions)

Gross Profit and Margin (in Php Millions)

Net Profit and Margin (in Php Millions)

16

46,024

84,697

59,80067,334

2013 2014 9M 14 9M 15

7,871

14,484

10,252 10,952

17.1% 17.1%17% 16%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

20.0%

22.0%

24.0%

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

2013 2014 9M 14 9M 15

GP GP Margin

4,012

8,133

5,530 5,830

8.7%9.6%

9.2% 8.7%

0.0%

5.0%

10.0%

15.0%

20.0%

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

2013 2014 9M 14 9M 15

EBITDA EBITDA Margin

2,548

4,520

3,007 3,203

5.5% 5.3%5.0% 4.8%

-1.0%

1.0%

3.0%

5.0%

7.0%

9.0%

1,000

2,000

3,000

4,000

5,000

2013 2014 9M 14 9M 15

NIAT NIAT Margin

LIQUOR SEGMENT HIGHLIGHTS

BrandyAlfonsoAlfonso lightExelenteCarlos

TequilaPatron

WhiskyJohnnie walker

RhumBacardi

TequilaCuervo

WhiskyBushmills whiskiesChivas

CognacVodkaLiquers

Products

17

BrandyFundador lightFundador

WhiskyJB/Grants

LIQUOR SEGMENT HIGHLIGHTS

2014 2013 Increase %

Brandy 860,048 737,985 122,063 17%

Other spirits

and w ines 442,298 320,356 121,943 38%

1,302,346 1,058,340 244,006 23%

Specialty

beverages 87,556 53,854 33,702 63%

1,389,902 1,112,194 277,708 25%

Category

9M 2015 SALES MIXFY 2014 SALES MIX

18

2015 2014 Increase %

Brandy 587,862 427,682 160,180 37%

Other spirits

and w ines 302,700 241,176 61,525 26%

890,563 668,858 221,705 33%

Specialty

beverages 82,297 63,916 18,381 29%

972,860 732,773 240,086 33%

Category

LIQUOR DISTRIBUTION FINANCIAL PERFORMANCE





19

3,565

4,841

2,7103,377

2013 2014 9M 14 9M 15

1,0031,176

664770

28.1%24.3% 24.5%

22.8%

8.0%

13.0%

18.0%

23.0%

28.0%

33.0%

38.0%

200

400

600

800

1,000

1,200

1,400

2013 2014 9M 14 9M 15GP GP Margin

731 832

477 52320.5%

17.2% 15.5%17.6%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

100

200

300

400

500

600

700

800

900


594 603

361 38216.7%

12.5%13.3%

11.3%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

100

200

300

400

500

600

700

2013 2014 9M 14 9M 15

NIAT NIAT Margin

REAL ESTATE SEGMENT HIGHLIGHTS

• Total of 32 properties in 2014 and 27 in 2013.• Gross Leasable Area (GLA) in 2014 378,756 and 286,880 in 2013.• Acquisitions of six (6) commercial properties in 2015 adding GLA of

35,649 sq. m.• Operates 38 commercial properties and buildings as of 9M 2015

with GLA of over 414,000 sqm.• EPHI completes its 2nd co-development mall project with Ayala Malls

at Fairview Terraces in January 2014.• COSCO Capital acquires NE Pacific Mall, Cabanatuan, in Feb 2014.

20


Portfolio of Properties

21

Dec 2013 Dec 2014 9M 2015

1. Land under Lease

Number of properties 7 9 9

Total area in sqms 85,704 145,980 145,980

Book value Php3,324mm Php4,243mm Php4,243mm

2. Commercial Buildings

Number of buildings 18 21 27

Total GLA in sqms 145,876 177,476 213,125

Investment costs Php5,427mm Php7,549mm Php8,668mm

3. Divisoria 999

Number of buildings 2 2 2

Total GLA in sqms 55,300 55,300 55,300

Investment cost Php4,162mm Php4,162mm Php4,162mm

TOTALS

Number of properties 27 32 38

Investment costs Php12,913mm Php15,954mm Php17,073mm

Total GLA in sqms 286,880 378,756 414,405


Branches %

Sto. Cristo, Baliuag 99.2%

Cabanatuan 60.2%

Candelaria 89.7%

Cubao 99.2%

Don Antonio Heights 96.9%

Tabang, Guiguinto 97.5%

Caloocan, Monumento 97.3%

Pasig 90.5%

Q.I. 99.3%

San Juan, Batangas 83.3%

Sucat 97.9%

FY 2014 Occupancy rates

22

Branches Rate

Taguig 99.4%

Taytay 98.8%

Tayuman 98.5%

Valenzuela 73.1%

Dau 92.6%

Anabu, Cavite 94.5%

Subic Harbor Point 93.0%

Fairview Terraces 62.3%

Angeles, Pampanga 100.0%

Cabanatuan, NE 99.8%


Selected Financial Ratios

23

2014 2013 9M 2015 9M 2014

A. Ebitda / Rentals 78.4% 49.0% 80.3% 80.2%

B. Rentals / Property & Eqpt 12.3% 12.5% 12.6% 12.2%

C. Ebitda / Property & Eqpt 9.6% 6.1% 10.1% 9.8%

D. Debt : Equity 0.47 0.45 0.53 0.50

E. NIAT / Equity 6.0% 2.7% 5.3% 4.6%

REAL ESTATE FINANCIAL PERFORMANCE

Revenues (in Php Millions) Gross Profit and Margin (in Php Millions)

EBITDA and Margin (in Php Millions) Net Profit and Margin (in Php Millions)

24

1,8382,191

1,4571,721

2013 2014 9M 14 9M 15

980

1,275

8531,022

56.4%

58.9%

58.6%59.4%

54.0%

55.0%

56.0%

57.0%

58.0%

59.0%

60.0%

200

400

600

800

1,000

1,200

1,400

2013 2014 9M 14 9M 15GP GP Margin

771

1,146

9231,105

44.3%53.0%

63.4%64.2%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

200

400

600

800

1,000

1,200

1,400


563

959

56771550.1%

44.3%

38.9%41.5%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

200

400

600

800

1,000

1,200

2013 2014 9M 14 9M 15NIAT NIAT Margin

SPECIALTY RETAIL SEGMENT HIGHLIGHTS

Liquigaz Philippine Corporation

• 432,995 mT sold in 2014• Operates in 5 business segments• Current market share of around 30%.• Acquisition of G&G refiling tank in 2015.• Infrastructures:

• Bataan Terminal• North hub 75 mT tank size• South hub 40 mT tank size• Tanks at customer premises• Cylinders• Auto gas stations• Bulk trucks• Cylinder truck

Five Business Segments1. Wholesale2. Commercial3. Industrial4. Autogas5. Cylinders

25


Office Warehouse, Inc.

• A total 48 stores in December 2014• Total of 55 stores in 3Q 2015

• Net selling area of 5,597.08 sq.m.• 67% of outlets are mall based and 33% are stand alone• Target to open 10 stores in 2015

26


Product Mix

Category Products Share of Business

Ink & Toner Ink & Toner 32%

Office and School Supplies Papers, envelopes, folders, writing instruments, art materials, desk accessories

31%

Business Machine/ Technology Mainly printers, includes also phones, CCTV, biometrics, computer peripherals, calculators

24%

Office Furniture Tables, desk, cabinets, chairs, vault

8%

Services & Others Binding, photocopy, lamination, general supplies, electricals

5%

27


Well-known Global Partner Brands

28

SPECIALTY RETAIL FINANCIAL PERFORMANCE





29

8,727

3,159

10,122

2013 2014 9M 14 9M 15

576

300

1,084

6.6%

11%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

200

400

600

800

1,000

1,200

2013 2014 9M 14 9M 15

GP GP Margin

140

300

807

1.6%

8.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

100

200

300

400

500

600

700

800

900

2013 2014 9M 14 9M 15

EBITDA EBITDA Margin

13281

465

1.5%

4.6%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

100

200

300

400

500

2013 2014 9M 14 9M 15

NIAT NIAT Margin

30

Thank you

cosco capital groupcoscocapitalbeta.webtogo.com.ph/images/items/uploads/3q... · 2016. 1. 21. ·...

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